CATL Invests US$4.4 Billion in Mining for EV Battery Supply Chain Security

Contemporary Amperex Technology Ltd (CATL), an electric vehicle (EV) battery producer, plans to invest US$4.4 billion to establish a subsidiary. This new entity will manage and expand the company's mining assets, responding to a global energy shock. The investment aims to accelerate CATL's entry into the automotive and energy storage system (ESS) markets.

Credit: CATL

According to a filing with the Shenzhen Stock Exchange, the investment arm aligns with CATL’s long-term growth strategy. It will integrate existing mining assets, pursue high-quality mineral projects domestically and abroad, and safeguard raw material supply for the company’s core business.

CATL, based in Ningde, east China’s Fujian province, reported a net profit of 20.74 billion yuan in the three months to March. This figure marked a 48.5% increase from the previous quarter and surpassed a Bloomberg consensus estimate of 17.6 billion yuan.

Ding Haifeng, a consultant at Shanghai-based financial advisory firm Integrity, noted the battery company "has sniffed out huge growth opportunities looming ahead." Haifeng added that CATL is making significant investments into upstream mining resources to support its potential high growth.

ESS comprises batteries alongside battery management, power conversion, and control systems. These systems store excess renewable energy, provide backup power during outages, and help stabilise electricity grids.

The Middle East crisis has propelled Brent crude more than 30% higher, hovering around US$100. This has prompted car buyers to shift from petrol vehicles to EVs, while renewable energy projects have proliferated worldwide.

According to the GGII Energy Storage Research Institute, a Shenzhen-based consultancy, 19 Chinese battery producers it tracks planned to build new facilities. These facilities would be capable of producing more than 600 gigawatt-hours (GWh) of ESS batteries annually. One GWh of battery capacity can supply approximately 750,000 households for a year.

Zhou Ling, a hedge fund manager at Shanghai Shiva Investment, suggested the "slumbering EV market in China will not stop CATL from improving its earnings as ESS becomes a new growth driver." Ling anticipated the battery giant, leveraging its global dominance, will continue to attract institutional and individual investors.

China’s EV sales, including pure electric and plug-in hybrid vehicles, decreased more than 20% year on year to 1.91 million units. This slump followed the rollback of government subsidies and the phasing out of tax breaks.

Analysts predict that the global decarbonisation drive and the rapid buildout of artificial intelligence computing centres will help CATL and Chinese peers, such as Gotion High-tech, sustain growth in the coming decade.

China’s Ganfeng Lithium, the world’s largest lithium metal producer, stated that new power consumption scenarios, including data centres, are driving consistent demand for ESS.

In the first two months of 2026, CATL delivered 56.9 GWh of batteries to EV assemblers, an increase of 13.7% year on year. Its global EV market share rose to 42.1% in January and February from 38.2% a year earlier, according to Seoul-based SNE Research.

CATL reported a net profit of 72.2 billion yuan in 2025, up 42% from the previous year. This figure was only 8% lower than the combined profits of China’s top four listed carmakers – BYD, Chery, Geely Auto, and SAIC – which together earned 78.6 billion yuan.

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• CATL plans to invest US$4.4 billion in a new subsidiary to manage and expand mining assets.

• The investment aims to secure raw material supply for EV batteries and energy storage systems.

• CATL reported a 48.5% increase in net profit in the three months to March, exceeding estimates.

Source: SCMP